Key Takeaways
- Vistra jumped 8% today after third-quarter adjusted EBITDA rose more than 50% and it guided to $7.7 billion to $8.5 billion for 2027.
- About 98% of Vistra’s expected 2027 output is hedged, so a new Texas governor can’t reprice most of it.
- Talen Energy guides to faster growth with less hedged, and NRG Energy faces the same Texas questions.
- Even after the jump, Vistra trades below its usual forward P/E.
Vistra (VST) jumped 8% today after its third-quarter report gave investors what they wanted most this week: a first look at 2027.
Investors in Talen Energy (TLN), which guided to faster 2027 growth on Tuesday, and NRG Energy (NRG), which has its own Texas data center deal in the works, have a new yardstick too.
Right on target for 2027
Third-quarter ongoing operations adjusted EBITDA rose to $2.38 billion from $1.58 billion a year earlier.
The 2027 range’s $8.1 billion midpoint is a little above what analysts expected going in:
It’s also where management pointed in August.
Next year is already sold
The stock fell 16% in a week after Gina Hinojosa, who campaigned on a moratorium on new data centers, won the Texas governor’s race.
But Vistra had hedged about 98% of its expected 2027 output by Oct. 30, and a governor taking office in January can’t reprice power that’s already sold.
CEO Jim Burke announced a new 20-year deal at Vistra’s Odessa gas plant in Texas and said: “As the power landscape evolves, we continue to see more of these opportunities.”
TIKR tracks 23 analysts on Vistra. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on Vistra, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See Vistra’s Analyst Ratings
What it means for Talen and NRG
Talen guides 2027 adjusted EBITDA about 26% above 2026 at the midpoints, against about 11% for Vistra. But Talen had hedged only about 70% of 2027 by Sept. 30. Both stocks traded at about 13x forward earnings at the last close, and I’d take Vistra’s locked-in growth.
NRG’s Texas segment earned $381 million of adjusted EBITDA in the second quarter, down from $512 million a year earlier. NRG is still finalizing a 1.2 GW Texas gas plant deal for a hyperscaler. At 9.5x forward earnings, NRG is priced for trouble. Its report next week should show whether the hyperscaler is still going ahead after the vote.
Still cheap after the bounce
Before today’s jump, Vistra traded at 13x forward earnings, below its five-year average of 15x:
It’s about 14x at today’s price, and the board added $1.5 billion to the buyback.
The way I see it, investors sold Vistra for a risk its hedges mostly cover. Of course, Comanche Peak still has nuclear capacity to sell, and a Texas deal there under the new governor would be the real test.
So what is Vistra stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
